The chilling trade effects of antidumping proliferation

H. Vandenbussche, M. Zanardi

Research output: Contribution to journalArticleScientificpeer-review

Abstract

Advocates of antidumping (AD) laws downplay their negative effects by arguing that the trade flows that are subject to AD are small and their distortions negligible. But while the adverse effect of AD on product-level trade has long been established, the question remains whether there are trade effects at the aggregate level. The recent proliferation wave of AD laws and their use provides us with a unique policy change to estimate the true trade effects of adopting and enforcing AD laws. For this purpose, we estimate the effect of AD on bilateral trade flows between the “new adopters” of AD laws and their trade partners. Using a gravity model of annual observations (1980–2000) our estimates show that AD has trade chilling effects on aggregate import volumes but the impacts are heterogeneous across sectors. We find that new tough users experience a chilling of their aggregate imports of 14 billion US$ a year (or 5.9%) as a result of AD measures. For some countries like Mexico and India, the dampening effects of AD laws on trade flows are found to substantially offset the increase in trade volumes derived from trade liberalization.
Original languageEnglish
Pages (from-to)760-777
JournalEuropean Economic Review
Volume54
Issue number6
Publication statusPublished - 2010

Fingerprint

Proliferation
Trade flows
Import
Policy change
Trade liberalization
India
Bilateral trade flows
User experience
Gravity model
Mexico
Trade volume

Cite this

Vandenbussche, H., & Zanardi, M. (2010). The chilling trade effects of antidumping proliferation. European Economic Review, 54(6), 760-777.
Vandenbussche, H. ; Zanardi, M. / The chilling trade effects of antidumping proliferation. In: European Economic Review. 2010 ; Vol. 54, No. 6. pp. 760-777.
@article{fdcb5a9c9a1449e2bb01434d38a00989,
title = "The chilling trade effects of antidumping proliferation",
abstract = "Advocates of antidumping (AD) laws downplay their negative effects by arguing that the trade flows that are subject to AD are small and their distortions negligible. But while the adverse effect of AD on product-level trade has long been established, the question remains whether there are trade effects at the aggregate level. The recent proliferation wave of AD laws and their use provides us with a unique policy change to estimate the true trade effects of adopting and enforcing AD laws. For this purpose, we estimate the effect of AD on bilateral trade flows between the “new adopters” of AD laws and their trade partners. Using a gravity model of annual observations (1980–2000) our estimates show that AD has trade chilling effects on aggregate import volumes but the impacts are heterogeneous across sectors. We find that new tough users experience a chilling of their aggregate imports of 14 billion US$ a year (or 5.9{\%}) as a result of AD measures. For some countries like Mexico and India, the dampening effects of AD laws on trade flows are found to substantially offset the increase in trade volumes derived from trade liberalization.",
author = "H. Vandenbussche and M. Zanardi",
note = "Appeared previously as CentER DP 2006-12 (rt)",
year = "2010",
language = "English",
volume = "54",
pages = "760--777",
journal = "European Economic Review",
issn = "0014-2921",
publisher = "Elsevier Science BV",
number = "6",

}

Vandenbussche, H & Zanardi, M 2010, 'The chilling trade effects of antidumping proliferation', European Economic Review, vol. 54, no. 6, pp. 760-777.

The chilling trade effects of antidumping proliferation. / Vandenbussche, H.; Zanardi, M.

In: European Economic Review, Vol. 54, No. 6, 2010, p. 760-777.

Research output: Contribution to journalArticleScientificpeer-review

TY - JOUR

T1 - The chilling trade effects of antidumping proliferation

AU - Vandenbussche, H.

AU - Zanardi, M.

N1 - Appeared previously as CentER DP 2006-12 (rt)

PY - 2010

Y1 - 2010

N2 - Advocates of antidumping (AD) laws downplay their negative effects by arguing that the trade flows that are subject to AD are small and their distortions negligible. But while the adverse effect of AD on product-level trade has long been established, the question remains whether there are trade effects at the aggregate level. The recent proliferation wave of AD laws and their use provides us with a unique policy change to estimate the true trade effects of adopting and enforcing AD laws. For this purpose, we estimate the effect of AD on bilateral trade flows between the “new adopters” of AD laws and their trade partners. Using a gravity model of annual observations (1980–2000) our estimates show that AD has trade chilling effects on aggregate import volumes but the impacts are heterogeneous across sectors. We find that new tough users experience a chilling of their aggregate imports of 14 billion US$ a year (or 5.9%) as a result of AD measures. For some countries like Mexico and India, the dampening effects of AD laws on trade flows are found to substantially offset the increase in trade volumes derived from trade liberalization.

AB - Advocates of antidumping (AD) laws downplay their negative effects by arguing that the trade flows that are subject to AD are small and their distortions negligible. But while the adverse effect of AD on product-level trade has long been established, the question remains whether there are trade effects at the aggregate level. The recent proliferation wave of AD laws and their use provides us with a unique policy change to estimate the true trade effects of adopting and enforcing AD laws. For this purpose, we estimate the effect of AD on bilateral trade flows between the “new adopters” of AD laws and their trade partners. Using a gravity model of annual observations (1980–2000) our estimates show that AD has trade chilling effects on aggregate import volumes but the impacts are heterogeneous across sectors. We find that new tough users experience a chilling of their aggregate imports of 14 billion US$ a year (or 5.9%) as a result of AD measures. For some countries like Mexico and India, the dampening effects of AD laws on trade flows are found to substantially offset the increase in trade volumes derived from trade liberalization.

M3 - Article

VL - 54

SP - 760

EP - 777

JO - European Economic Review

JF - European Economic Review

SN - 0014-2921

IS - 6

ER -